Nearly 2,000 council rent payments worth £385,000 bounced due to a banking error.

Barnet Borough Council has admitted that 1,800 of its direct debits to social landlord Barnet Homes failed on April 2.

The error occurred when Capita, the private firm responsible for much of the authority’s back office services, mistakenly cancelled direct debits to Barnet Homes while moving from a manual system to online.

It has since been resolved, but Capita has come under fire for what happened.

In a statement, a Barnet Homes spokesman said: “Barnet Homes apologises for any inconvenience that the direct debit error with rents payments this month might have caused some of our customers.

“We have also made sure we’ve communicated the situation to our customers clearly, including offering alternative payment options.”

Leader of Barnet council's Labour group, Councillor Alison Moore, criticised Capita for the error.

Cllr Moore said: “This is now the third time that Capita has messed up something that is completely basic process and it is unacceptable.

“We've seen incorrect pension data being sent out to council pensioners, claw-back of overpayments to school staff and now this.

"People are rapidly losing confidence in Capita's ability to get even the most basic things right."

Conservative Barnet Council leader Councillor Richard Cornelius said: “The reality is that issues like this do crop-up now and again, whoever provides the service. We once had something similar with council tax when the service was in-house.

“The important thing is that the issue was identified and has been resolved. Capita is saving the taxpayer £1m each and every month.”

A Capita spokesman said: “A new process to automate direct debit payments, removing the need for forms to be manually sent to residents’ banks with their details, was introduced in February.

“While moving from a manual system to online, direct debits for Barnet Homes’ rent payments in April were mistakenly cancelled. All residents affected by the missed collection were notified immediately and the payments have now successfully been received.

“Capita would like to apologise to residents affected, and to Barnet Homes. We have now introduced a new system and will provide training to employees by the end of April.”